Australia moves to axe cabotage

The Australian federal government today announced it is to axe legislation introduced to promote Australian-flagged shipping and will deregulate the coast.

While the move has been hailed by Shipping Australia Limited, the peak industry body representing foreign shipping in Australia, and some business circles, the Labor opposition, unions, and the Australian Shipping Association – recently renamed Maritime Industry Australia – have condemned the move.

Under the new provisions announced in the budget, a single coastal trading permit will cover all foreign shipping, foreign vessels will be allowed to carry petroleum products, ships only need to hire senior Australian crew on vessels trading for longer than 183 days on the coast, and the national Fair Work workplace provisions for crew will be replaced with international employment standards.

Legislation must first pass through a hostile senate, where the Labor opposition fiercely opposes the proposed changes.

Opposition spokesperson for transport Anthony Albanese described the reforms as “an ideologically charged attack on the viability of Australian shipping”, adding that Australian mariners would be put on third world wages.

In an interview with IHS Maritime, Maritime Industry Australia CEO Teresa Lloyd said the legislation would destroy the “very nucleus” of the Australian shipping industry.

“Removing the fundamental element of cabotage does change the fabric of the industry and makes it much more volatile,” Lloyd said. “This has big implications for the Australian maritime economy and our strategic maritime skills. We will end up with absolutely no Australian shipping. They won’t wait to be driven out of business – they are not that silly. They will close down or they too will [flag out] and become foreign.”

Shipping Australia, however, has welcomed the proposed reform, with CEO Rod Nairn saying it was “the first stepping stone to a better coastal trading regime”.

“But there’s still a long way to go to get changes finalised through consultation and then legislated,” he said.

“The proposed changes will breathe new life into coastal shipping,” Nairn said in an official SAL release. “This sector has languished since the 2012 Coastal Trading Act was introduced. These reforms are absolutely necessary to allow domestic goods to be efficiently carried by sea.”

As the third anniversary of the entry into force of the Maritime Labour Convention 2006 (MLC) approaches, Seafarers’ Rights International (SRI) is embarking on a comprehensive study on the effectiveness of the Convention. The study has been commissioned by the International Transport Workers’ Federation. It will be an in-depth and... Read more →